FREMONT – A low-cost home builder has bought two properties in Fremont implicated in a real estate fraud case in a deal that could return some of the money to investors who securities regulators claim were defrauded by a developer in the Bay Area.
MidPen Housing Corp., through an affiliate, acquired plots at 41965 and 42021 Osgood Road in Fremont, according to filings filed November 30 with the Alameda County Registry.
MP Irvington, a subsidiary of MidPen, paid $ 13.5 million for the two sites, county records show.
These Fremont sites are among the many properties that were part of the Bay Area real estate empire created by failed developer Sanjeev Acharya and his fraudulent company Silicon Sage Builders.
The Securities and Exchange Commission accused Acharya and Silicon Sage of a variety of fraudulent activities that, according to the SEC, have taken away hundreds of investors, many of them from the South Asian community.
According to real estate documents, MidPen Housing’s purchase of plots in Fremont was a cash-only deal.
Jeff Aguilar, a broker at CBRE, a commercial real estate firm, orchestrated the purchase, US District Court records show.
A federal judge has transferred ownership of Silicon Sage to legal action. David Stapleton, the court’s appointed administrator, began the difficult process of trying to save the value of the collapsed and bankrupt real estate empire by finding buyers for the property.
According to court documents, before selecting a potential buyer for the Osgood Road site in Fremont, the recipient sold the property within a few months.
The previous property offer called for the development of 284 housing units on 3.5 acres of land on Osgood Road.
But it is now possible that a new development proposal could be submitted to the City of Fremont, as Silicon Sage’s original plans did not include affordable homes.
Broker CBRE has solicited bids from several potential buyers and set a deadline for bids in May this year.
MidPen Housing, the alleged new owner of Fremont’s Osgood Road real estate, is a veteran non-profit housing developer.
“Our work at MidPen is rooted in the belief that safe and affordable housing is the foundation people need to thrive and contribute to their communities,” MidPen said on its website.
According to a posting on MidPen’s website, the company has built 8,500 homes for low-income families, seniors and people with disabilities.
“There is nothing more rewarding than providing stable housing that allows people to thrive, not just survive,” MedPen Housing said in a statement.